Which of the following statements correctly describe the implications of deadweight loss in a monopolistically competitive market? Select all that apply.

Deadweight loss in a monopolistically competitive market happens when the price of a product is higher than its marginal cost, which means that fewer people buy the product than would if it were priced lower. This loss occurs because the company has some control over its prices and does not produce at the most efficient level, leading to a situation where potential gains from trade are not realized. For example, if a coffee shop charges $5 for a cup of coffee but it costs only $3 to make, some customers who would be willing to pay $4 might not buy it, causing a deadweight loss. In this way, both consumers and the producer miss out on possible benefits, resulting in a less efficient market overall. Understanding deadweight loss helps us see why competition is important for keeping prices fair and maximizing benefits for everyone.